The Current State of Broadband Funding Programs

If you feel that keeping up with the multitude of broadband funding programs has been a daunting task, rest assured, you're not alone. In recent years, I've come to realize the sheer complexity of the matter and decided to create a document outlining the major programs and their progress.

As a result, I published the first edition of Broadband Needle Movers, a comprehensive report providing detailed insights into closed, ongoing, and forthcoming programs back in late 2021. While I was updating the main page of the 2024 edition, I realized something somewhat profound: Most of the money has been, or is about to be, awarded.?

While BEAD is a massive injection of forthcoming funding, the reality is that nearly $50 billion is already in play, not even counting the recent Enhanced ACAM or ongoing ACAM or CAF BLS program!

As we move forward, it's essential to reflect on where it all began, so here's a bit of a stroll down memory lane. In the chart below, colors represent the different federal agencies involved, while placements indicate whether the program is closed (left side), open (in the middle), or still to come (the right).

(Note: The chart below reflects the release of ReConnect 5, which came on February 21st. It also reflects the effective closing of the Affordable Connectivity Program which shifts more dollars into the "closed" column.)

What's Closed

Here are the nearly $34B from programs that are behind us for the most part, with builds now ongoing.

Rural Digital Opportunity Fund (RDOF): $6.1 billion awarded

Remember this one? Ironically, the "provisional" winning bidders accounted for $9B of potential awards, but only 2/3 made it past the FCC's in-depth reviews. Build milestones are coming up in late 2024 and early 2025, so this will be one to watch to see how well firms can meet their targets.

Emergency Connectivity Fund (ECF): $7.1 billion obligated

This program from the FCC is finally drawing to a close with funds given to schools, libraries, and others to help close the "homework gap." While it didn't directly provide build funding, except in narrow cases, it was a big opportunity for a lot of providers. There are no known plans for an ECF 2 at this time.

Middle Mile Fund: $1 billion obligated

This was the only fund directly focused on the middle-mile networks that connect rural areas back into more populated regions with denser fiber assets, internet access, etc. Ironically, the more money that is spent here, in many instances, the lower the overall cost of internet in the last mile since less “mainline” has to be built.

ReConnect Rounds 3 and 4: $3.4 billion obligated

Some pretty impressive programs have been funded by the USDA's ReConnect program, with one of the largest average awards per product. Designed to serve the most rural areas, ReConnect has been around for some time and the USDA Rural Utility Service (RUS) is recognized as some of the most knowledgeable in how to get builds completed with providers. A key area to watch is how to deconflict ReConnect awards from BEAD going forward.

Tribal Connectivity Program I: $2 billion awarded

We reached the end of the Tribal Connectivity Program to provide digital equity, adoption, and broadband infrastructure for many tribes. Looking at infrastructure only, nearly $1.7B went to these areas across the country. With a significant level of demand, it led to the second tribal window (see Open programs).

Affordable Connectivity Program: $14.2 billion

Sadly, I've had to put this in the "closed" column (note the dashed lines in my graphic). According to recent reports, only about $2.2B is left of the fund intended to support broadband adoption by those in need, but more importantly, all applications were "frozen" on February 8th and there is no path in sight for further funding. Congress has yet to act and, from what I hear on the ground, most providers think the program may be over ... at least for the foreseeable future.

What's Still Open

"Only" about $19B of funding is in play across various states or programs, but we're running out of funds and time!

ARPA Coronavirus monies: ~$8 billion (estimated)

States, counties, and cities received $350B of funding for a variety of needs, including broadband. Based on Treasury estimates, nearly $8.2B (as of September 2023) went to broadband needs. Unless extended, each state, county, or city must have funds obligated by December of this year, and costs can be expended through the end of 2026. This deadline is critical as some states are still finalizing awards to broadband providers for builds. Time is of the essence!

Capital Projects Fund: $10 billion

In addition to the ARPA Coronavirus money, Treasury also allocated funds for broadband directly to states in the Capital Projects Fund. Similar to the BEAD process, states had to submit plans and proposals to Treasury for approval to use their allocated funds. Roughly 90% of the funds have now been granted to states, and states are in the process of awarding this money to providers or using it for other broadband and digital equity projects. Like ARPA, projects need to reach substantial completion by December 31, 2026.

Tribal Connectivity Program II: $1 billion

Due to a recent extension, tribes have until March 22, 2024, to submit for additional broadband needs with awards up to $50M in size.

What's Coming

Everyone knew about BEAD but within the past 48 hours we just learned that USDA has the fifth round of ReConnect coming -- all told it's another $45B to the mix!

Broadband Equity, Access, and Deployment (BEAD): $41.6 billion to the states and territories

This is the one that everyone is writing about. By my estimates, we won't see any actual money in the hands of the providers until 2025 at the earliest, but 2026 is more likely. When you layer in the period of performance requirements for ARPA and Capital Projects, some states have to get those awards out first and THEN get their awards for BEAD.

Digital Equity: $2.75 billion

This is a sister program to BEAD from NTIA that has just started making awards to states based on their proposed plans.

ReConnect Round 5: $700M

As I noted, we just learned about the latest round of ReConnect funding to become available with a $700M pot. That breaks down to $200M for 100% loans, $200M for 50/50 grant/loan combos, and another $150M for 100% grants. The rest is designated for specific populations (e.g., tribal areas, socially vulnerable communities, etc.). The window opens March 22nd and is expected to run for ~60 to 90 days (there was an error in the original notice, which you can find here).

What It All Means

Many of us have lived through these programs over the past few years, but it's important to take a step back and remember what we've achieved already as we look ahead to BEAD. Here are some key points to remember as we go through it this time:

• Grants are a form of financing, so you should have a comprehensive build strategy before deciding whether a grant is the right approach for your business.
• There is a lot of money potentially already in play in your area. Be sure you know who got what, how much, and where. This will be critical as you build your competitive and challenge strategy.
• Given the evolving nature of BEAD, stay connected to your Broadband Office, your association, and what's happening in DC to determine what makes sense for you.

What other funding challenges are on your mind?

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